By Cassie Fish, http://cassandrafish.com
CME live cattle futures have started a holiday-shortened week the defensive, most active April LC making a new low for the move and technical indicators finally moving into oversold territory. The market has been correcting since late December and is now 300 points off the high made then.
There is no urgency in the cash market to alter the downward trajectory of futures. Last week’s 78k head negotiated fed cattle trade volume, at about 0.80 cents lower than the prior week’s new high, contained 20k cattle sold with time. That statistic clinches power for the packer, who already has had more formula cattle to draw upon this month in some key areas. It is hard to understand with 2023 teed up to see the tightest fed cattle supplies in years, why anyone would sell with time, but perhaps it’s the trauma of the past 3 years.
With no pressure on the packer this week, a sagging futures market would seem to be a likely outcome. On the boxed beef side of things, the choice cutout lost almost $9 from a week ago, but when looking at last week’s weekly average price of $281.10, it was the down only $2.52 from the prior week and was record high for that week.
'The Beef' is published by Consolidated Beef Producers